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Mismanagement, corruption, inefficiencies touching new heights in power sector

The mismanagement, corruption and inefficiencies in power sector has touched its peak as authorities concerned have failed to collect electricity bills amounting to Rs 34 billion in one month of May this year that added into monster of circular debt, it is learnt.

The poor performance of cash bleeding power sector is touching new heights that also paved the way of changing portfolio of Naveed Qamar as people of Pakistan are witnessing hours long load shedding but key policy makers have failed to come up with viable plan on the basis of permanent solutions.

“The power sector has just collected Rs 35 billion in shape of electricity bills out of total due bills amounting to Rs 69 billion till May 31 (last month) so the monster of circular debt added by Rs 34 billion in just one month,” one of top official of economic team of Gilani government confided to The News.

The line losses and other mismanagement is another hole in the power sector but the situation is alarming that the relevant authorities are loosing grip over recovery of bills as well at a time when there is already an average gap of Rs 5 per unit in generation of electricity and amount recovered from customers.

“In these circumstances no one will be able to end circular debt because it will reappear as happened in most of cases in last four years,” said the official and added that there should be limit to this unwarranted situation otherwise the economic stabilization would be at stake in case of keeping no check on inefficiency of power sector.

When a close aide of outgoing Minister for Water and Power Naveed Qamar was asked about reasons for change in portfolio, he said that Ch Ahmed Mukthar claimed before the leadership that he would be able to end this crisis. But the insiders say that both President and Prime Minister were convinced that change at highest level was required to move towards the desired reforms in power sector otherwise it possessed ability to choke the whole economic system of the country.

The sorry state of affairs in power sector is heading towards complete anarchy after witnessing recent violent protests in major cities of the country but there is complete insensitivities towards miseries facing by the people in the wake of scorching heat. Citing one such example the official said in one recent meeting the Ministry of Water and Power high-ups were asked to inform high powered ministerial committee on energy that how much electricity per unit is generated from 5,000 tons fuel procured from state owned PSO on daily basis and there was no clue to them.

Another question was raised before PSO authorities that whether any advance metering system was put in place to ascertain that the power sector is getting due supply of fuel against its payment. On this issue it was informed that there was old traditional system and no advance technology was installed in shape of advance meters to determine exact quantity of fuel against the received bills.

Now Ministry of Finance is insisting to develop a chart on daily basis to get information that how much units of electricity is getting each one of power distribution companies (DISCOs) and how much is getting by selling and what is exact position in terms of recovery of bills.

Despite doling out Rs 1122 billion on the name of so called subsidy for power sector in last four year the situation on ground worsened. The government raised tariff in the range of over 150 percent but the losses of DISCOs did not decrease in a major way.

Alone in outgoing fiscal year the power sector subsidies touched RS 412 billion that included Rs 312 billion of outstanding liabilities of previous out of total Rs 391 billion including other commodities and fertilizer as well.